California Districts Granted Immunity From Federal Suits

A recent ruling by a federal appeals court may shield school
districts in a growing number of states against some types of lawsuits
brought against them in federal courts.

The U.S. Court of Appeals for the Ninth Circuit ruled late last
month that due to extensive state control over school finances,
California school districts are state agencies and deserve the same
11th Amendment immunity against federal lawsuits enjoyed by other
branches of state government.

In general, the 11th Amendment protects states from being sued in
federal court without their consent. There are many exceptions to that
rule, however, such as suits against officers of a state, suits brought
by the federal government, and suits filed under laws in which the
Congress has clearly set aside the states' immunity.

In a line of cases dating back to the late 1800's, the U.S. Supreme
Court has held that 11th Amendment immunity does not extend to a
state's political subdivisions. In a 1977 case, Mt. Healthy School
District v. Doyle, the Court ruled that school districts enjoy
sufficient autonomy to fit into this category.

In its decision in Belanger v. Medera Unified School District, the
Ninth Circuit Court ruled, however, that California's role in local
school finance has become so pervasive so as to reduce districts to the
status of arms of the state. The case was brought by a former
elementary-school principal who claimed that her reassignment to a
teaching position was discriminatory.

"A judgment against the school district would be satisfied out of
state funds,'' the three-judge panel unanimously ruled. "In the
critical area of school funding, around which this litigation revolves,
California has selected a different path from that of most states.
California has vested control of school funding in the state rather
than local governments.''

Far-Reaching Effects?

The Ninth Circuit Court's ruling could have implications far beyond
California due to the wave of lawsuits aimed at forcing states to
assume a greater share of the school-finance burden.

The appeals court found that California's own court-ordered
school-finance remedy in the early 1970's, combined with its
property-tax limitations, stripped districts of a distinct political
identity.

"The state has assumed the burden of funding public schools, and
property-tax revenue allocated to the public-school revenue-limit
program is state money collected for a state purpose,'' the judges
wrote. "In short, the state determines the amount of money that school
districts may spend per pupil and then provides the necessary state
funds.''

Observers noted that California exerts an unusually high degree of
control over its districts. But, they added, other states are moving
quickly in the same direction.

California's "combination of a high state share of funding, and caps
and restrictions on local funds, [is] fairly unusual,'' said Mary
Fulton, a research associate for the Education Commission of the
States. "They are in a small group of states that have that kind of
control. In most states, there is still quite a bit of leeway on local
funding.''

"California is a little different than other states, but
nevertheless, I would say that the 11th Amendment defense is now worth
putting in,'' said Gwendolyn Gregory, the deputy general counsel for
the National School Boards Association. "Certainly, if I were a
school-board lawyer these days, I would run it up the flagpole.''

Property-Tax Control

The federal appeals court concluded that California's efforts to
manage districts' local property-tax revenues contributed greatly to
the dilution of local control.

"Under the revenue-limit system, state and local revenue is
commingled in a single fund under state control,'' the judges wrote.
"In essence, any use of the commingled funds is a use of state
funds.''

The court said that the state's influence over such matters such as
textbook selection and student-expulsion policy also influenced its
decision. But, it said, the most important factors were the
distribution of funds and language in the state constitution that
charges lawmakers with primary responsibility for supervising public
schools.

The court ruled that although "public schooling is usually
considered to be a local governmental function,'' under California law
"school districts are agents of the state that perform central
governmental functions.''

Legal Test

In its ruling, the appeals court used a test set in a 1989 case
involving the Los Angeles community-college system to determine whether
the Medera school district was a branch of the state.

Under the test, the court must ask whether state funds would be used
to settle a financial judgment, whether the defendant in the case
performs a central governmental function, whether it can participate on
its own in a lawsuit, whether it can hold property, and what is the
defendant's corporate status.

"It is the state legislature that has acknowledged the local needs
of the individual school districts throughout the state,'' the court
held. "That the state itself has decided to give its local agents more
autonomy does not change the fact that the school districts remain
agents under state control.''

Vol. 11, Issue 35, Page 5

Notice: We recently upgraded our comments. (Learn more here.) If you are logged in as a subscriber or registered user and already have a Display Name on edweek.org, you can post comments. If you do not already have a Display Name, please create one here.

Ground Rules for Posting
We encourage lively debate, but please be respectful of others. Profanity and personal attacks are prohibited. By commenting, you are agreeing to abide by our user agreement.
All comments are public.